"Central Banks Now Own $25 Trillion Of Financial Assets"

With 85% of Wall Street telling Citi they expect a "dovish hike signal" from Yellen tomorrow, which means a polite request for another BTFD opportunity, even if as BofA says "expectations for a dovish Fed are coinciding with macro strength in the US (most obviously in housing & consumer spending) as well as highest level of wage inflation since Jan’10"...

Risk assets are now supported by the new ”Keynesian Put”, the expectation that fiscal measures will be deployed to combat any renewed weakness in the economy/markets (independently of any larger political projects). But asset prices remain primarily supported by excess monetary abundance across the world: 1.There have been 667 interest rate cuts by global central banks since Lehman; 2.G7 central bank governors Yellen, Kuroda, Draghi, Carney & Poloz have been in their current posts for a collective 17 years, yet only one (Yellen in Dec’15) has actually hiked interest rates during this time; 3.Central banks own $25tn of financial assets (a sum larger than GDP of US + Japan, and up $12tn since Lehman); 4.There are currently $12.3tn of negative yielding global bonds (28% of total); 5.There is currently $8tn of negative yielding sovereign debt (54% of total).

“Risk assets are now supported by the new ”Keynesian Put”, the expectation that fiscal measures will be deployed to combat any renewed weakness in the economy/markets (independently of any larger political projects).”

Economics is not a science. Not even close. It’s a discipline of sorts, and also a ‘faith’ of sorts, with different denominations and adherents of different philosophies. I personally don’t think its a good idea basing monetary policy that can have huge effects on our lives and those of our children and our children’s children on some economy professor’s theory - in this case Keynes. We are experimenting with our future.

Will not end well. There's a big difference between today when inflation is shifted to the GDP growth column and the 70's when such numbers were not as phony. The employment situation has reverted to the 70's in terms of labor force participation. The difference then was Carter was actually principled enough to appoint someone like Volker (also a type of Democrat that they no longer make). The Republican side is controlled by the chamber of commerce which is perfectly happy to have the highest nominal corporate rates in the world as long as their members can bribe the Congress for some economically distorting tax breaks.

Even with Trump we have no way to rid the world of monetary corporate socialism slowly sliding into fascism. What we will get with Trump is some breathing room and some good trade deals which will increase trade with some countries and an opportunity to start the deleveraging process. But we probably won't. The reason is that crony capitalist economies like China can't compete on economic merit. Instead the communist leaders prop up base industries and then they have to resort to bubbles that they will try to propagate here. We can have a boom but until we get rid of worldwide economic distortions from low rates and asset purchases it will be boom and bust.

Money is a ruthless master and an unforgiving “god.” The world is being set up for the tyrannical rule of the Antichrist. The elites who worship their false gods will soon learn what a tremendous mistake they made, but only when it is too late for them.

“Financial Assets”? More like “Confederate Money”.

These are the same bogus re-hypothecated mortgage-backed loans that were traded back and forth so often that nobody knows who actually owns them.

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